Interflora v Marks & Spencer [2013] EWHC 1291 (Ch)

In a High Court judgment handed down on 21st May 2013, Mr Justice Arnold found in favour of Interflora in its long-running litigation with Marks & Spencer over the use of the trade mark “Interflora” as a Google AdWord to advertise Marks & Spencer’s flower delivery service.

Since 2008, both Interflora and Marks & Spencer have paid Google, in a practice known as “keyword advertising” or “pay-per-click advertising”, to display their respective floral delivery advertisements whenever internet users search for the word “Interflora” (and other derivations). This practice has typically resulted in both companies’ advertisements appearing in the sponsored links section, or as referred to by Arnold J in the “golden box”, at the top of a user’s search results screen.

Interflora, who at all relevant times had the majority of the market share in online floral deliveries, claimed that Marks & Spencer’s advertisements appearing beside their own was confusing to online consumers, who would think mistakenly that Marks & Spencer were a part of the Interflora network of florists.

This judgment follows a series of references to the European Court of Justice (“CJEU”) concerning interpretation of trade mark infringement law in respect of use of a trade mark as a sponsored search term in a search engine.

Following the CJEU guidance, Arnold J said that, when viewing Marks & Spencer’s advertisements, he would need to adopt the perspective of the “reasonably well-informed and reasonably observant internet user”. He ruled that such a user is not particularly technically literate and does not know precisely how AdWords operate.

A large portion of the judgment was reserved for consideration of whether Marks & Spencer’s use of AdWords affected, or was liable to affect, the functions of the trade mark – primarily of relevance in this case was the origin function.

The judge assessed whether a reasonably well-informed and reasonably observant internet user, even with their general knowledge of the market, could ascertain whether Marks & Spencer’s floral delivery service originated from Interflora. He said that such a user should not be deemed to have this knowledge, as he was not satisfied that it was known that Marks & Spencer were not part of the Interflora network. He said further that there was nothing in the Marks & Spencer advertisements to inform the user that they were not part of the network. Finally, he said that due to the nature of the Interflora network (that it has many commercial tie-ups with large retailers and that many partners operate under their own brands), it would make it difficult for a user to determine whether Marks & Spencer was part of the network.

The question now for trade mark proprietors is whether or not they can successfully claim for trade mark infringement in relation to a competitor using their trade marks in competitive keyword advertising. As Arnold J explained, it is established law that keyword advertising is not inherently or inevitably objectionable from a trade mark perspective. Furthermore, he went on to explain that CJEU case law recognises that such keyword advertising promotes competition. Nevertheless, this case shows that there can be cases where such use is infringement. Considering the particular facts of this case, in particular the way the Interflora network operates with independently owned florists operating under their own brand name participating in the network, trade mark owners should treat this result with a certain amount of caution before considering whether to commencing proceedings.